The pathophysiology of diabetic nephropathy (DN) is too complex and involves a variety of pathways and mediators. Hyperglycaemia and dyslipidemia are identified as major risk factors for diabetic nephropathy. Various studies revealed the fact that dyslipidemia is a major contributor to the process of diabetic nephropathy. Dyslipidemia refers to abnormal lipid levels. Lipids like LDL, free fatty acids, abnormal lipoproteins, ceramides, etc., are unsafe for kidneys. They target proximal tubular epithelial cells, podocytes, and tubulointerstitial tissues through biochemical changes, especially by enhancing the release of reactive oxygen species (ROS) and lipid peroxidation, endorsing tissue inflammation and mitochondrial damage, which give rise to nephropathy. Major lipid targets identified are SREBP1, LXR, FXR PPAR, CD-36, PKc, AGE/RAGE pathway, and ferroptosis. The drug acting on these targets has shown improvement in DN patients. Various preclinical and clinical studies support the fact that hyperlipidemic agents are promising targets for DN. Therefore, in conjunction with other standard therapies, drugs acting on dyslipidemia can be added as a part of the regimen in order to prevent the incidence of ESRD and CVD.